EU’s industry alliances need stricter oversight, say green critics

Ahead of the European Commission’s new industrial strategy proposal, expected on Wednesday (5 May), Friends of the Earth has compiled a report exposing the influence of business associations in shaping policy through industrial alliances.

The Commission is expected to announce more industry alliances on Wednesday, including new ones on renewable energy and low-carbon fuels.

These alliances, like the Clean Hydrogen Alliance and the Battery Alliance, are set up by the European Commission, and bring together national authorities, regions, industry research institutes and other stakeholders to push forward European industry in a sector considered of strategic importance.

But while they do include trade unions and NGOs, they give industry a chance to shape European policy to suit their interests, said Myriam Douo, one of the co-authors of the report at Friends of the Earth.

“At the very, very least there should be a very big consideration on transparency and composition and mandate, and who steers those alliances,” she says.

The report, which will be published on Wednesday, looks into the EU executive’s reliance on a new wave of industrial alliances that began in 2017 with the European Battery Alliance. It says alliances allow the industry to frame the debate because they establish privileged communication channels between business groups and policymakers.

“For me, it’s this whack a mole game. The industry is always trying to set the agenda with new technology that’s going to save the world and then it takes scientists and civil society a long time to debunk. Then the next day they come up with something new,” Douo told EURACTIV.

Contacted by EURACTIV, the European Commission defended its approach to alliances, and rejected suggestions that they are tipped in favour of industry.

“Alliances comply with the principles of openness, inclusiveness, transparency and diversity and are set up in compliance with competition rules,” the EU executive said in an emailed statement.

“Industrial alliances are open to all public and private entities and organisations along the value chain who are ready to contribute to alliances objectives,” it added.

Created by industry for industry

According to Friends of the Earth, the idea behind industrial alliances came from a little-known Commission advisory body known as the Strategic Forum for Important Projects of Common Interest (IPCEI).

Their common feature, campaigners claims, is that they tend to water down policy.

Activists cite the Circular Plastics Alliance, designed to boost the EU market for recycling, as a case in point. According to Friends of the Earth, the alliance “fell far short of tackling plastic pollution or Europe’s dependency on fossil-based plastics” and delayed further regulatory action on the matter.

The Raw Materials Alliance, announced in September 2020, was similarly “intended to be an initiative by, for and of industry,” campaigners say.

The advisory body behind the alliances also included Hydrogen Europe, an industry body which went on to be the driving force behind the Clean Hydrogen Alliance, and even wrote to the Commissioner for Internal Market, Thierry Breton, offering to run it.

The NGO’s report details communication between the European Commission, Hydrogen Europe and the fossil lobby before the clean hydrogen alliance was eventually launched, in July last year.

Hydrogen Europe spent six months shaping the alliance into a “near-perfect” industry body and its work led to a hydrogen strategy that “strongly echoes the industry’s wish list,” Friends of the Earth claims.

European Commission officials fended off those accusations, telling EURACTIV that Hydrogen Europe was not involved in the preparation of the EU’s hydrogen strategy, which was presented in July last year.

“Its assistance on launching the alliance did not impact the preparation of the hydrogen strategy,” Commission officials said.

Similarly, Hydrogen Europe said the formation of the Clean Hydrogen Alliance was built on the principles of transparency and inclusiveness and now includes representatives from across the industry as well as NGOs.

“It is about time to establish clear rules [on] how industrial alliances should be built up,” Hydrogen Europe told EURACTIV, adding that many procedures had to be established during the formation of the alliance.

Still, Green lawmakers in the European Parliament are deeply sceptical of these groups.

“I would not treat industry alliances differently from industry as a whole,” says Jutta Paulus, a Green MEP. “They are, where applicable, covered by antitrust legislation which is, of course, a no-brainer. I would just not give them exclusive rights or privileges compared to companies that are not part of such an alliance.”

[Edited by Frédéric Simon]


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